A story published today in the Atlanta
Business Chronicle reports that low
interest rates, combined with downtown beginning to show signs of life,
have meant big business for the Atlanta real estate industry.

As
the region's population swells, real estate agents are discovering that
their clients are increasingly younger and single.

Matt Moeggenberg, an agent for Metro Brokers/GMAC Real Estate in Cobb
County, oversees a 32-unit condo community in Austell. Although the
community almost is sold out, Moeggenberg said he sold only two of the
units to married couples.

The
trend isn't just a local one.

In
1995, 70 percent of home buyers were married, according to a 2004 study
by the National Association of Realtors. That figure dropped to 62
percent in 2004.

Meanwhile, between 2001 and 2003, the number of single home buyers
increased from 22 percent to 32 percent. Research from SMR Research
Corp. suggests that single buyers may eventually outnumber married
buyers who finance purchases with a mortgage.

Single homeowners are buying in Atlanta because urban revitalization
efforts are finally taking root, making the city more attractive to
young singles, said Julian Diaz, interim chairman of the real estate
department at Georgia State University.

"There's been renewed interest in the urban experience. That clearly
goes in Atlanta. You've got a city life and a 24-hour lifestyle that has
become viable here. So you have a lot of developments that cater to
that," he said.

Historically low interest rates also are fueling the singles surge.

"The low interest rates really set off some light bulbs in single
people," said Radley Reiff, an agent at Metro Brokers who focuses on
Buckhead and the Georgia 400 corridor and says 65 percent of his clients
are single.

But
many of these singles are buying homes with interest-only mortgages, the
same mortgages that Federal Reserve Chairman Alan Greenspan said this
summer were creating "froth" in the housing market.

Although Diaz doesn't believe the housing market is experiencing a
"bubble," he said he thinks a market correction is inevitable in the
next few years. When that happens, the singles who bought homes with
interest-only mortgages will find themselves in trouble, he said.

"Some of these people shouldn't be qualified for the loans they're
getting," Diaz said.

These homeowners will not be the sole contributor to a correction, but
Diaz said they could make it worse because the buyers won't have created
any equity.

"It
reduces our ability to weather any hard times coming ... but when [the
housing market] goes down, the problem will be exaggerated and more
widespread than it would have been," he said.

Despite the dire predictions, agents said they have begun to focus their
marketing efforts on the single demographic.

"Marketing to singles has been a conscious decision for us. We advertise
in different places and talk to different people," Moeggenberg said.

With more activities downtown, many single buyers are opting for intown
neighborhoods.

But
Reiff said he has had a growing number of single clients buying homes
outside the Perimeter.

"[Singles] are branching out into the suburbs. I've been doing a lot of
sales in places like Alpharetta in neighborhoods that tend to be more
family-oriented," he said.

If
a single person buys in the suburbs, Moeggenberg said, it is for the
extra space.

"If
you can afford a $150,000 condo downtown, you're going to get a
one-bedroom place that probably won't even have a dining room. But once
you've lived here awhile, you can move out and pay the same amount for
1,400 or 1,800 square feet," he said.

Despite the likelihood of rising interest rates and a market correction,
real estate agents and analysts don't expect singles to walk away from
opportunities to own a home.

"The challenge for a single person is to go from renting to owning. But
it's going to be impossible to get someone to go from owning to
renting," Reiff said.

The
larger question is whether intown communities will be able to entice
singles to stay in the neighborhood after they marry or have children,
Diaz said.

"This is the problem Atlanta has always had. What happens when these
young people grow up? Are they going to stay and make lifelong
commitments to the community or are they going to leave and follow
better school systems? The jury is still out on that," he said.